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Ripley v. Eon Labs Inc.

August 16, 2007

CHERYL RIPLEY, INDIVIDUALLY PLAINTIFF,
v.
EON LABS INC., SANDOZ INC., AND NOVARTIS PHARMACEUTICALS CORP., DEFENDANTS.



The opinion of the court was delivered by: Joseph H. Rodriguez United States District Judge

Memorandum Opinion and Order

These matters come before the Court upon the motion of Plaintiff Cheryl Ripley to remand this case back to the Superior Court of New Jersey, Law Division, Camden County and upon the motion of Defendant Novartis Pharmaceuticals Corporation to dismiss the Complaint against it pursuant to Fed.R.Civ.P. 12(b)(6) for failure to state a viable claim. Plaintiff's motion to remand is predicated on the lack of both diversity jurisdiction and federal question jurisdiction. Defendant Novartis contends that the complaint fails to demonstrate a sufficient nexus between Novartis and the injuries Plaintiff alleges that she sustained. The Court entertained oral argument on these motions on August 9, 2007. The Court has considered the arguments outlined in the parties' briefs, in addition to those advanced during oral argument. For the reasons set forth below, the Court denies Plaintiff's motion to remand and denies Defendant Novartis' motion to dismiss.

I. Plaintiff's Motion to Remand

Plaintiff filed a complaint in the Superior Court of New Jersey, Law Division, Camden County on February 23, 2007. Plaintiff alleges that she suffered a severe, life threatening allergic reaction, known as Toxic Epidermal Necrolysis ("TEN"), following ingestion of a generic version of Relafen-Nabumetone. (Compl. at ¶¶ 10-13) The generic drug in question was manufactured by Defendant Eon Labs, which is a subsidiary of Defendant Sandoz, Inc. Defendant Sandoz is owned by Defendant Novartis.

On February 26, 2007, Defendant Sandoz removed this matter to the United States District Court for the District of New Jersey, Camden Visinage on the basis of diversity jurisdiction and federal question jurisdiction. On March 16, 2007, summonses were issued as to all of the Defendants. Defendant Eon Labs has its principal place of business in the State of New York. Defendants Sandoz and Novartis are principally placed in the State of New Jersey. Plaintiff Ripley is a citizen of the State of California.

Plaintiff first argues that removal pursuant to 28 U.S.C. §1441(b) is unavailable to Defendants because both Novartis and Sandoz are citizens of the State of New Jersey, where the original action was first filed. Plaintiff's second argument challenges the propriety of removal on subject matter jurisdiction grounds. Plaintiff also asserts a claim for punitive damages pursuant to N.J.S.A. 2A:58C-5, which states:

Punitive damages shall not be awarded if a drug or device or food or food additive which caused the claimant's harm was subject to premarket approval or licensure by the federal Food and Drug Administration under the "Federal Food, Drug, and Cosmetic Act," 52 Stat. 1040, 21 U.S.C. § 301 et seq. or the "Public Health Service Act," 58 Stat. 682, 42 U.S.C. § 201 et seq. and was approved or licensed; or is generally recognized as safe and effective pursuant to conditions established by the federal Food and Drug Administration and applicable regulations, including packaging and labeling regulations. However, where the product manufacturer knowingly withheld or misrepresented information required to be submitted under the agency's regulations, which information was material and relevant to the harm in question, punitive damages may be awarded. For purposes of this subsection, the terms "drug", "device", "food", and "food additive" have the meanings defined in the "Federal Food, Drug, and Cosmetic Act."

Thus, Plaintiff asserts that the requirement that Plaintiff show fraud-on-the-FDA does not raise a substantial federal issue conferring subject matter jurisdiction pursuant to 28 U.S.C. § 1331 on this case. The Court finds that Defendant properly removed this case to this Court based on diversity of citizenship because at the time of removal, none of the Defendants had been "joined and served". Consequently, the Court need not address whether subject matter jurisdiction exists.

An action may be removed from state court if it could have been originally filed in federal court. 28 U.S.C. § 1441(a). An action removed from state court predicated upon diversity of citizenship must not only satisfy the citizenship and amount in controversy requirements of 28 U.S.C. 1332 (a), but must also satisfy 28 U.S.C. 1441(b), which provides that:

Any civil action of which the district courts have original jurisdiction founded on a claim or right arising under the Constitution, treaties or laws of the United States shall be removable without regard to the citizenship or residence of the parties. Any other such action shall be removable only if none of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.(emphasis added).

As the removing party, Defendant Sandoz bears the burden of demonstrating that removal was proper. Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir.1990). When considering a motion to remand, the Court must strictly construe removal statutes in favor of remand. Steel Valley Auth. v. Union Switch & Signal Div., 809 F.2d 1006, 1010 (3d Cir.1987). Here, the parties agree that complete diversity exists amongst the parties and that the amount in controversy exceeds the statutory requirement. Accordingly, the issue before this Court is whether the citizenship of New Jersey Defendants Novartis and Sandoz precludes removal pursuant to 28 U.S.C.§ 1441(b).

Where the meaning of a statute is at issue, the Third Circuit has stated that "[i]t is elementary that the meaning of the statute must, in the first instance, be sought in the language in which the act is framed, and if that is plain, and if the law is within the constitutional authority of the law-making body which passed it, the sole function of the courts is to enforce it according to its terms." Abdul-Akbar v. McKelvie, 239 F.3d 307, 313 (3d Cir. 2001). "If the language of the statute is plain, the sole function of the court is to enforce the statute according to its terms." Id. (citing United States v. Ron Pair Enters., Inc., 489 U.S. 235, 241, 109 S.Ct. 1026, 103 L.Ed.2d 290 (1989)). The Court may only depart from this mandate where "the literal application of a statute will produce a result demonstrably at odds with the intentions of its drafters. " Ron Pair Enters., 489 U.S. at 242, (quoting Griffin v. Oceanic Contractors, Inc., 458 U.S. 564, 102 S.Ct. 3245, 73 L.Ed.2d 973 (1982)).

The Court finds that the plain language of 28 U.S.C. § 1441(b) does not bar the Defendants' removal in this case because at the time that the action was removed, the Defendants had not yet been "properly joined and served". The Court further finds that removal under these circumstances does not produce a result "demonstrably at odds with Congressional intent".*fn1 The Court's decision finds support from other courts within this district, in addition to several courts sitting in other districts.

Most recently, this Court considered whether an in State defendant who has not been served with the complaint can remove the matter to federal court despite the prohibition contained in 28 U.S.C. ยง 1441(b). In an unpublished opinion in Thomson v. Novartis Pharms. Corp., 2007 WL 1521138 (D.N.J. May 22, 2007), this Court found that because the forum defendants had not been served at the time of removal, their citizenship did not offend the language of 1441(b). In reaching this conclusion, the Court recognized the "colorable policy arguments" against ...


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